Thursday, May 22, 2008

Tax Term of the Week

Tax Credits- Tax credits are much like credits you get from a store. After you figure your tax bill, you can use the credit to reduce the amount of the check you must write to Uncle Sam. Tax credits are more valuable than deductions because they directly cut the amount of tax you owe, rather than reducing the amount of taxed income. A $200 credit, for example, will turn a $1,000 tax bill into only $800. And a few even could give you a refund you weren’t expecting.

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